Debt Recovery

Legal Dispute Resolution

Good credit control can avoid the need to take debt collection action. However, where a debt arises and remains unpaid, swift and effective measures need to be taken to maximise the chances of a recovery.

At KBL we have an experienced debt recovery department. To find out the costs involved to recover your debt please call 01204 527777. We deal with debt collection in a professional and proportionate manner:

  • We do not send out automatically generated letters. Each case is individual and the way forward is determined on the issues and parties involved.
  • We deal with debt matters from start to finish, unlike many bulk debt collection agencies and solicitors, who are unable to proceed with recovery once the matter becomes disputed or complicated.
  • We have great expertise in enforcement of judgment debts, including issuing insolvency proceedings, instructing a bailiff/sheriff, implementing charging orders, attachment of earnings and third party debt orders.

You can increase the possibility of recovery by obtaining personal guarantees where appropriate. Please contact our corporate team if you are interested in introducing personal guarantees.

KBL's Debt Recovery Service

What is Debt Recovery? Debt Recovery is a litigation procedure used to recover debts which are outstanding to our clients from their customers. It is to be utilised where payment is outstanding with respect to the services and/or product provided by our client to their customers and delay is adversely affecting our client's business.

Why should you use it? Not having an effective system of debt collection and credit control can adversely affect the profitability of a business and in serious cases of default, ultimately undermine that business resulting in its untimely failure.

How can we help? We aim to recover debts quickly or to advise you early on if it is not possible. Clearly, where a debtor goes into insolvent liquidation and no security has been provided to the client as a creditor, then it will not be possible to get paid. However, our experienced team will not only be able to advise which debts are worth pursuing but can also make use of all available Court procedures to ensure prompt payment of any sums outstanding together with a Court Order for fees incurred in instituting proceedings.

Why should you act NOW? In our experience, successful debt collection is about "first come, first served". We find that a delay in instituting legal proceedings can invariably result in failure to recover at all. This is principally because there is a time factor associated with litigating a debt through the Courts. Whilst this process is ongoing, struggling debtors invariably seek advice from Insolvency Practitioners, Accountants or other legal advisers and enter into one of the various methods of insolvency arrangements currently available such as a:

  • Creditors Voluntary Arrangement
  • Administration (increasingly popular)
  • Insolvent Liquidation.

The entering into of any of those types of arrangement generally has the effect of prohibiting the creditor from pursuing the debtor any further. In short, a creditor is effectively frozen out from proceeding any further and merely ranks as an unsecured creditor should the debtor company go into Insolvent Liquidation. It may be a further 12 months therefore before the debtor receives payment and the amount he receives is usually a small percentage of the amount he was originally owed.

Delay in issuing proceedings often means that the legal costs which have been incurred from the issuing of proceedings until the creditor company goes into some form of Insolvent Liquidation arrangement, are also unrecoverable from the debtor. We would describe this as an unfortunate "double whammy". The client here not only suffers the indignity of not recovering a legitimate debt which has been outstanding for a period of time, but also ends up having a liability to the solicitor for pursuing the debt.

Careful consideration therefore needs to be given to pursuing debtors and once it is resolved to pursue that debt it needs to be actioned quickly.

In our experience clients invariably have important "commercial relationships" with the businesses they are thinking of pursuing and they are reluctant to pursue that debtor through the Courts for fear that the Court proceedings will undermine that relationship. We understand the importance of commercial relationships; however the importance of a commercial relationship always needs to be weighed against the affect of not receiving payment in respect of a particular invoice.

If you are prepared to forego payment in its entirety in the interests of preserving and maintaining commercial relationships generally, then the debt should not be pursued.

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